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Stock market : Tesla falls after Elon Musk’s tweet

Stock market : Tesla falls after Elon Musk’s tweet

Tesla’s shares on the Frankfurt Stock Exchange fell by around 9% on Monday as investors prepared for Elon Musk’s sale of a tenth of his shares in the company. An announcement he made in the form of a poll on his Twitter account.


Elon Musk, the world’s richest person, tweeted on Saturday that he would be dumping 10% of his Tesla shares if his followers approved the move. To do so, he published a poll with two simple answers, for or against the proposal. Three and a half million people took part in the vote, and 57.9% of them voted “for” the American billionaire’s proposal.


In reaction, Tesla shares listed in Frankfurt fell by 7% over the weekend, finally reaching a 9% drop on Monday. In the United States, the electric car manufacturer’s share price has gained 73.2% since the beginning of the year. According to Reuters calculations, Elon Musk owned about $170.5 million worth of Tesla shares as of June 30, and the sale of 10 percent of them would amount to nearly $21 billion based on Friday’s close.


Prior to this Twitter poll, Elon Musk had said he would have to exercise a large number of stock options over the next three months, which would result in a large tax bill. Selling some of his shares is therefore a way to free up funds to pay his taxes.


There’s been a lot of talk lately about unrealized gains being a means of tax evasion, so I’m proposing to sell off 10% of my Tesla shares,” Elon Musk said on Saturday, adding that he wasn’t taking cash pay or bonuses from “anywhere.”


All this comes as US Senate Democrats unveiled a proposal to tax billionaires’ stocks and other marketable assets to help fund President Joe Biden’s social spending agenda, closing a loophole that allowed them to defer capital gains taxes indefinitely.


Finally, they run out of money for the rest of us, and then they come looking for you,” Elon Musk said, criticising the plan.


Ron Wyden, the chairman of the Senate Finance Committee that introduced the tax proposal, said on Saturday: “Whether or not the richest man in the world pays taxes shouldn’t depend on the results of a Twitter poll.

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The carmaker’s market value surpassed $1 trillion in market capitalisation at the end of October, becoming the fifth US company to join a crowded club that already includes Apple, Microsoft, Amazon and Alphabet.





Featured photo : © James Duncan Davidson

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